Minimum coverage gives you just enough liability insurance to get on the road.
Your state probably requires you to have liability coverage before you drive a vehicle. And if money is tight, you may want to pay as little on car insurance as possible.
One option is to buy minimum coverage, which insures you just enough to meet your state’s requirements.
What is minimum coverage?
Unless you live in New Hampshire or Virginia, you must have liability insurance to drive a car. Minimum coverage is the lowest amount of liability coverage you’re allowed to have. It may not cover you for all of your state’s requirements — for example, you may also need to buy uninsured motorist coverage or personal injury protection.
Though minimum coverage may be enough to get you on the road, consider buying a higher level of coverage. Costs from auto accidents often exceed the limits of minimum coverage, and you’ll have to pay out of your own pocket if your insurance isn’t sufficient.
Does it come with a deductible?
Minimum liability coverage usually doesn’t come with a deductible. For example, if you hit another car and your insurance covers the cost of the other driver’s repairs, you won’t have to pay out of your pocket.
What is a deductible?
The deductible is what you’ll pay before your insurance company will pay a claim.
Let’s say you file a claim to your insurance company for a $5,000 car repair bill. Your insurance covers you for that amount, but it includes a $500 deductible. This means you must pay $500 out of your own pocket before your insurance will cover the other $4,500.
Minimum coverage in action
In Hawaii, you’re required to have at least 20/40/10 liability coverage. That means you need:
- $20,000 of coverage for bodily injury per person in an accident
- $40,000 of coverage for bodily injury per accident
- $10,000 of coverage for property damage per accident
Minimum coverage will insure you up to those limits. But it doesn’t cover you for Hawaii’s other requirement: $10,000 of personal injury protection (PIP). You’ll need to get PIP separately if you buy minimum coverage.
Why should I buy minimum coverage?
If you don’t have the means to buy more comprehensive auto insurance, minimum coverage can insure you just enough for you to get on the road.
Minimum coverage insures you against expenses for bodily injury and property damage. However, it won’t pay for expenses from other damages, such as repairs to your own car (you’ll need collision coverage for that).
Consider buying other forms of insurance. You may find that protecting yourself more comprehensively doesn’t have to cost a lot.
How much does minimum coverage cost?
The cost of minimum coverage will vary considerably depending on your age, where you live and your driving history, among other factors. It can be a few hundred dollars to more than $1,000 a year. Keep in mind that the cheaper your car insurance, the less coverage it probably offers.
How do I buy minimum coverage?
It’s a standard insurance policy, so nearly all insurers offer minimum coverage. Use our insurance comparison tool to shop around at different providers.
Minimum coverage will get you on the road quickly. However, you may want to buy more coverage to protect yourself — and your state may require additional forms of insurance.